Three million jobs created in India in last six months: Myth vs reality

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May 02, 2018, 10.31 AM IST

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Independent economists say the steady rise in job creation will provide the missing link for the policy-makers in Delhi, although the EPFO data fails to provide details on new job creation in the non-farm sector.

The job market is gaining traction, finally. Giving ammunition to Prime Minister Modi to defend his promise on job creation ahead of the 2019 general election, data released by the Employees Provident Fund Organisation show that more than three million new jobs were created in the six months to February 2018.

Independent economists say the steady rise in job creation will provide the missing link for the policy-makers in Delhi, although the EPFO data fails to provide details on new job creation in the non-farm sector. The government’s critics also question the timing of the EPFO update, coming ahead of the crucial assembly elections in Karnataka. According to them, the data grossly overestimates new jobs creation, as many workers from the unorganised sector have now joined the EPFO, thanks to the incentives from the Centre.

Questions are also being raised on the quality of jobs, which remains a big concern.

What do these numbers foretell? Are the EPFO numbers a reaffirmation of the pick-up in the economic activity, or just a hype created by the government’s managers ahead of the crucial assembly polls? On ET NOW’s India Development Debate, economists and political party leaders analysed the jobs scene in the country. Here are some interesting observations:

NARENDRA TANEJA, BJP SPOKESPERSONEver since the NDA government took over, it has added billions of dollars to the economy and we are getting a very good feedback from the people. There are some others who are trying to create a different narrative, painting a doomsday scenario. The fact remains that people are getting jobs, although they are not necessarily getting ‘sarkari naukri’. The whole ecosystem that we are building is such that people can find jobs for themselves and even become entrepreneurs.

RAVI SRIVASTAVA,SCHOOL OF SOCIAL SCIENCES, JNUIt is very strange that the government has somehow taken these figures to mean a net accretion to jobs. The fact remains that even those who started this debate — Ghosh & Ghosh — very clearly say this is gross addition of jobs. What the EPFO figures can tell us at best is if jobs are being added in the formal sector. It is difficult to draw short-term conclusions from EPFO data because employers file their EPFO returns sporadically.

MANISH SABHARWAL, TEAM LEASE SERVICESOne has to be careful while dealing with survey data in India. The belief that administrative data is flawed and survey data is right is not true. The notion that the EPFO data is fudged is delusional. For the first time, we are recognising formal employment. India’s problem is not employment; it is productivity. The country is undergoing a massive formalisation of the jobs market as a consequence of GST.

SANJAY JHA, CONGRESS NATIONAL SPOKESPERSONNobody is objecting to formalisation of the labour force. There is no denying that even PhD-holders, engineers and management graduates are applying for the job of a peon. This itself is the manifestation of the acuteness of the job crisis across the country. The EPFO data covers just about 15% of India’s total work force. The big concern is more and more people don’t have social security, as they move to contractual labour and that explains the angst and frustration of people.

RUPA SUBRAMANYA, ECONOMIST & RESEARCHERThe numbers that are coming from the EPFO are not wrong; the problem is the inference. We don’t have reliable, real-time and single-source data. That is the reason we have wide-ranging estimates. If you claim you created 15 million jobs, that too in a year of demonetisation and GST, that means we don’t have a jobs problem; it is a problem of wages. You can’t ignore the fact that there is massive underemployment across the country.